A controlled assessment of the outcomes of two contrasting treatment regimes for hospitalized schizophrenia patients is planned, one involving an active milieu therapy program (including antipsychotic medication and psychiatric clinical management) and the other involving a similar program supplemented by intensive individual psychotherapy continuing until no longer indicated. The pilot project will examine the cost-effectiveness of several measures, the feasibility of interhospital interchange of data and personnel, the feasibility of control and sample selection procedures, the effect of strict informed consent procedures upon sample bias of any, the feasibility of random assignment of therapy, the sensitiveness to change of the measures, and the most effective assessments of the nature of a millieu therapy program and of its effectiveness. The study will involve collaboration between River Oaks Foundation, The Boston State Hospital and the McLean Hospital.